The Supreme Court allowed Tadgh Horan’s appeal over the date from which interest was payable on costs awarded in an arbitration, ruling that interest ran from the date of the arbitrator’s award.
In a judgment delivered on 1 March 2004, Denham J said section 34 of the Arbitration Act 1954 applied to money directed to be paid by an award, including costs whose exact amount had not yet been determined. Unless the award directed otherwise, that money carried interest from the date of the award at the same rate as a judgment debt.
Horan and Thomas Quilter had begun a veterinary surgery partnership in or about 1989. After disputes arose, they agreed to refer them to an arbitrator. Interim awards were made in 1992 and 1993, followed by a final award in 1996. The final award gave Horan the costs of the arbitration reference and witnesses’ expenses.
Horan later submitted a bill of costs for £30,331.65. In 2001, the High Court allowed him to enforce the award as a judgment or order and ordered Quilter to pay that amount, together with the costs of those proceedings. The High Court declined to award interest from the date of the arbitration award, allowing it to accrue from the date of its own judgment instead.
Horan argued on appeal that the arbitrator’s award should carry statutory interest from the date it was made. Quilter’s submissions included that the award itself did not have the standing of a court judgment or order and that interest under section 34 did not apply to costs that were not stated as a specific sum.
The Supreme Court focused on section 34, rather than section 22 of the Courts Act 1981, which was conceded not to be relevant. Denham J held that the section did not require the precise amount to be specified in the award. The ruling drew on the principle that interest on court costs can run from the date of the order, even if the costs are quantified later.
The court varied the High Court order to enable interest to run from the date of the arbitrator’s award as well as from the date of the High Court judgment. The appeal concerned the timing of interest; the Supreme Court’s order addressed that issue.